MSI Monitoring

All MSI medical claims are subject to audit.  A medical billing audit is performed to determine if a physician was paid appropriately for services rendered.  The audit process seeks to determine if an insured service was performed, that it was medically necessary, that it was not misrepresented in the claim for payment, and whether the service meets the requirements set out in the MSI Physician’s Manual, and any relevant information provided to physicians in the MSI Physicians’ Bulletins.

MSI Documentation Requirements

Claims submitted to MSI are to be billed in accordance with the Preamble of the Physician’s Manual and must be verifiable from the patient records associated with the services claimed.

For MSI purposes, an appropriate medical record must be maintained for each insured service claimed.  This record must contain the patient’s name, the health card number, the date of service, the reason for the visit or presenting complaint(s), the clinical findings appropriate to the presenting complaint(s), the working diagnosis and the treatment prescribed.

If a procedural code is claimed, the patient record of that procedure must contain information which is sufficient to verify the type and extent of the procedure according to the Fee Schedule.  If a differential fee is claimed based on time, location, etc., the information on the patient’s record must substantiate the claim.  If the fee claimed is calculated on a time basis, start and finish times must be part of the patient record of that service.

Audit Initiation

Audit resources are allocated on the basis of risk assessment activity.  MSI conducts a risk analysis process to aid in the identification of potential overbilling through such processes as profile review, analysis of various ad hoc peer comparison reports, post payment analysis of claims’ submissions, review of service verification letter responses, complaint(s).

Peer comparison statistics are used to determine if physicians’ billings are different than the average for a selected peer group.  Peer groups may be based upon type of practice, specialty, payments, and/or location of practice.

Depending upon the nature of the billing issue, it may be possible to identify that selected services have been billed inappropriately without an onsite review of patient records.  For example, an internal claims review may indicate that tray fees have been billed and paid with ineligible injections.  In such a case, MSI will communicate with the physician regarding the billing error.  In these instances, a recovery schedule is agreed upon with the physician without an onsite audit being required.

Audit Time Period

When an onsite billing audit is required, the audit is usually based upon a random sample of services, of a selected service type, drawn from the most recent two year period.

The period may be expanded to cover a longer time period depending upon the nature of any identified billing issues or other information.

There may be instances where services are selected in a nonrandom manner based on specific criteria related to the identified billing issue.

Sample Selection Process

In general, a random sample of approximately 105 paid claims associated with the type of service potentially being claimed inappropriately is extracted for review.  If more than one type of service is under review, multiple samples of paid claims are audited.

Onsite Audit Process

For the purpose of audit, MSI may require the onsite inspection of any books, documents, accounts, reports, invoices, and patient records with respect to insured medical services that may, as determined by MSI, be relevant to the audit.  The Health Services Auditor who conducts the audit may make notes regarding or copies of such books, documents, accounts, reports, invoices, and patient records as the Health Services Auditor considers necessary to document their findings.


Prior to conducting an onsite audit, the Health Services Auditor notifies the physician by letter to indicate that it is necessary to conduct the onsite audit.  The audit is scheduled for a mutually agreeable time.


During the audit, the physician must make available to the Health Services Auditor the documentation associated with the services billed so that MSI can determine if the documentation supports the health service code billed.

During the course of the onsite audit, copies are made as necessary so that the documentation is available for future review.

Review of Audit Findings

After completing the audit, the Health Services Auditor forwards the audit findings to the Medical Consultant for review.  The Medical Consultant will review the documentation to determine if services have been billed appropriately.  If a patient record does not substantiate the claim for the service, then the service is not paid or a lesser benefit is given. The Medical Consultant may meet with the physician to discuss the audit findings, and obtain clarification if necessary.

MSI may, at any time during the audit process, terminate the investigation, if it is of the opinion that the evidence does not warrant proceeding any further.  Upon the termination of an investigation, MSI shall provide written notice of the termination to the physician in question.

During the review of the audit findings, the audit sample size and audit time period may be increased to further determine the extent of infractions.

For the determination of an audit recovery, information subsequently provided by a physician after the onsite visit will not be used to support the service claimed unless such information can be determined to have existed prior to the audit being conducted.  The assessment is based upon the documentation available during the onsite visit.

Audit Outcome

The sample audit results of the audited service type may be extrapolated over all similar claims paid during the period from which the sample was drawn for the purpose of calculating a recovery.

Where MSI has determined after an audit that a physician has inappropriately billed services to MSI or has been inappropriately paid, MSI may do one or more of the following:

a) enter into an agreement with the physician including but not limited to recovering any overpayment made by MSI to the physician by deducting the amount of the overpayment from any other amounts payable by MSI to the physician;

b) refuse or reduce payment of a claim or claims for insured services, or an account;

c) refer the matter to the appropriate law enforcement authority or to the appropriate licensing authority, or to both;

d) refer the matter to the Department of Health and Wellness pursuant to the Health Services Insurance Act (HSIA).

e) reaudit the physician within a specified time period to ensure that billings are appropriate.

Provider Notification of Audit Findings/Recovery and Appeal Process

Schedule E – 2019

Schedule K – 2023

Fillable Forms

Request for Pre-Payment Assessment Review

Notice of Audit Review

Notice of Dispute

Notice of Intent to Proceed to Arbitration


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Site last updated: April 16th, 2024.